A senior aviation ministry official told IANS that the Directorate General of Civil Aviation (DGCA) "taking full cognizance of the reply sent by the airline has decided to suspend the operating license to further notice."

"The decision was taken today (Saturday) keeping in full view the present situation in which the airline has no reasonable plans to restart operations or how it will manage to pay its employees." The suspension came a day after the airline sought more time to reply to a showcause notice sent by the regulator on its revival plans.

"We are not satisfied with their reply. They have not come up with a solution to their industrial unrest problems and we can not wait for ever for them to come up with something," the official added. The regulator had issued a notice seeking a reply from the airline about its plans to restart operations and to pay the employees salaries.

It has said the airline risks suspension of its licence as it has "failed to establish a safe, efficient and reliable service". The regulator has also rejected the passenger carrier s winter schedules for flight departures.

The airline last year had a departure rate of 2,930 flights per week, but has since reduced capacity due to mounting debt and an exodus of employees.

The airline had the lowest market share in September, which stood at 3.5 percent. It has a total debt of Rs.7,000 crore with banks.

The airline has only 10 operational aircraft from an earlier strength of around 66 planes a year ago. It was also the country s second largest airlines by passenger traffic.